Ivory Coast Tensions Escalate; Senegal Backs Invasion

Source: Bloomberg
January 12, 2011, 7:02 AM EST
By Pauline Bax, Olivier Monnier and Drew Hinshaw

(Updates with details of gunfire in Abidjan from fourth paragraph.)

Jan. 12 (Bloomberg) -- Senegal renewed calls for military intervention to end the post-election stalemate in Ivory Coast, where clashes in the commercial capital, Abidjan, marked escalating tensions in the world’s top cocoa grower.

Senegal’s President Abdoulaye Wade is lobbying leaders in the Economic Community of West African States to stand by a Dec. 24 pledge to use military force to remove incumbent President Laurent Gbagbo from power if he refuses to step down in favor of Alassane Ouattara, the United Nations-recognized winner of the presidential election in November, his spokesman said.

“Gbagbo has to leave by any means necessary, even military means,” Wade’s spokesman, Papa Dieng, said yesterday in an interview in Senegal’s capital, Dakar. “If he stays there, African leaders will feel there’s no need to ever concede an election.”

One person was killed in Abobo, a suburb of Abidjan, said Yves Doumbia, a spokesman for the town’s mayor said today. The streets were empty as residents stayed indoors to avoid the fighting. People “are very scared,” said resident Ladji Soumahoro by phone today. “Early this morning, security forces prevented people from leaving the area to go to work.” Gunfire was also heard in the suburb of Williamsville, where one of the city’s main police barracks are located.
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Cocody, Riviera Explosions

A police truck was burned in Abobo, Doumbia said by phone today, while Abidjan’s affluent Cocody and Riviera suburbs were rocked with explosions at 2 a.m. today, witnesses including resident Francois Durand said.

“I heard at least 10 explosions, either from grenade launchers or some kind of cannon, and sustained gunfire from Kalashnikovs,” Durand said. Ouattara is currently blockaded in a hotel in Riviera by the army, while the majority of Abobo’s inhabitants are his supporters.

Ouattara won 59 percent of votes in Abobo, according to the electoral commission, which named him the overall winner. Gbagbo, 65, refuses to cede power, citing a ruling by the Constitutional Council that annulled votes in parts of Ivory Coast’s north on fraud allegations and gave him victory. Gbagbo has retained the loyalty of the army, while Ouattara is backed by the African Union, the U.S. and former colonial ruler France.

At least four people were killed yesterday after security forces loyal to Gbagbo conducted a house-to-house search for weapons in Abobo, according to Mustapha Ouattara, a spokesman for the pro-Ouattara RHDP coalition. A doctor at the military hospital in the city said nine members of the security forces were shot and injured, state-owned RTI television reported.

Peacekeepers Pelted

A United Nations patrol was halted by a roadblock as it attempted to enter Abobo, Kenneth Blackman, deputy spokesman for the UN mission in Ivory Coast, said yesterday. Peacekeepers were pelted with stones by civilians whose political affiliation wasn’t clear, Blackman said. The UN peacekeepers are protecting Ouattara headquarters in Abidjan.

UN Secretary-General Ban Ki-moon has asked the security council to agree to send 2,000 soldiers and three attack helicopters to the West African nation to deter the threat of violence, as “the precarious situation could quickly degenerate into widespread conflict”.

The UN’s 9,100 peacekeepers and civilian police are “operating in an openly hostile security environment with direct threats from regular and irregular forces” loyal to Gbagbo, Ban said in a Jan. 7 letter to Ambassador Ivan Barbalic of Bosnia-Herzegovina, president of the UN Security Council this month. The body is due to discuss the situation in Ivory Coast on Jan. 14.
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Residents Flee

An estimated 210 people have been killed in post-election violence, the UN said last week before the Abobo clashes. As many as 25,000 people have fled from the west of the country into neighboring Liberia, and are arriving at a rate of about 600 each day, the UN’s refugee agency said in a statement yesterday.

Kenya’s Prime Minister Raila Odinga is due to return to Ivory Coast this week in his second attempt to find a resolution to the conflict. He follows former Nigerian President Olusegun Obasanjo, who made an unannounced visit to the country Jan. 8.

John Atta Mills, the president of neighboring Ghana said on Jan. 7 it will not contribute troops to an Ecowas intervention, saying he doubted it would “bring peace.”

Senegal, which has contributed troops to peacekeeping missions in places such as Liberia, Sudan and Democratic Republic of Congo, has a “well-trained and disciplined” army, according the U.S. State Department website.

Sanctions

Senegal supports sanctions imposed on Gbagbo’s leadership by the European Union and U.S., Wade’s spokesman Dieng said.

“We’re talking timidly about sanctions,” he said. “The president feels that we here in West Africa should start.”

Amid the political crisis, Ivory Coast missed a $29 million interest payment on its $2.3 billion of Eurobonds on Dec. 31. It has a 30-day period of grace to make the payment.

The government is “fully committed” to meeting payment obligations to avoid defaulting on the bonds, said Annick Kone, a spokeswoman for the finance ministry, in an interview today. Finance and Economy Minister Desire Dallo sent a letter to bondholders dated Jan. 10, saying the country would honor the obligation within the grace period.

The statement caused the Eurobonds to jump the most in intraday trading yesterday since being issued in April, gaining as much as 11 percent. They traded 1.1 percent lower at 40.333 cents on the dollar at 11:55 a.m. in Abidjan today, according to data compiled by Bloomberg. The yield on the bond, due December 2032, increased to 15.877 percent.

Cocoa prices have risen 7.4 percent since the election and climbed for a fourth straight day today, adding $26, or 1 percent, to $2,960 per metric ton at 11:56 a.m. in London trading.

--With assistance from.... Read more

Brazil's Credit Boom Could End in Tears

Source: Business Week
Consumer credit has shot up fivefold since the end of 2002. Now Brazil's leaders are moving to head off a subprime-style crisis
By Alexander Ragir and Dawn Kopecki
The Nov. 9 rescue of Brazil's 21st-largest bank, Banco PanAmericano, has exposed cracks in what many had regarded as one of the most solid financial systems among emerging-market countries. Brazil's economy grew at a 8.4 percent clip in the first nine months of 2010—its fastest pace in more than 15 years—powered in part by a sharp increase in government-subsidized loans and a rapid expansion in consumer credit. That can be a lethal cocktail. The data in Brazil are troubling: Late payments on credit cards and other consumer loans jumped 23 percent in November from a year earlier, prompting government leaders to begin scaling back their easy-credit policies. "It's time to be a little bit careful about the B in BRIC," says Jim O'Neill, chairman of Goldman Sachs Asset Management (GS) and the man who coined the BRIC acronym for Brazil, Russia, India, and China.

Former President Luiz Inácio Lula da Silva, a founder of Brazil's Workers' Party, impressed Wall Street with his commitment to free-market policies. Yet even he was unable to resist the temptation of indulging in an age-old Brazilian tradition: the election-year splurge. The national development bank, known as BNDES, made $101.1 billion in loans in the 12 months to October, a 33 percent increase from the same period a year earlier. Lula's protégée and successor, Dilma Rousseff, pledged to rein in spending as she assumed power on Jan. 1.
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Bankers in New York, London, and as far away as Shanghai have a lot riding on how well Rousseff steers Latin America's biggest economy. With interest rates at all-time lows in much of the developed world, the 12 percent return on benchmark 10-year Brazilian government bonds has attracted money from all over. Foreign investors poured $15.9 billion into Brazil's stock market in the past two years. "The quest for yield and higher investment returns has flooded Brazil and other emerging markets with capital from around the world," says Russell Certo, a managing director at New York-based investment bank Gleacher & Co.

The capital inflows have buoyed Brazil's currency, the real, causing it to rise 34 percent against the dollar since late 2008. Finance Minister Guido Mantega, a holdover from the previous administration, has said he would consider a number of measures, including the imposition of new capital controls to fight the currency's appreciation, which puts Brazilian exporters at a disadvantage.

At the same time, Brazil's central bank is moving to curb the growth in consumer loans. The country has witnessed a fivefold expansion in consumer credit over the past eight years, with the total value of outstanding loans reaching $440 billion in October, according to central bank figures. This explosion was triggered in part by a 2001 regulatory change that allowed lenders to package auto, payroll, and other consumer loans into securities called FIDCs. The market for such notes has grown from nearly $290 million in 2003 to more than $35 billion last year.

Big Brazilian banks have stopped buying the credit portfolios since a November government probe into PanAmericano revealed losses stemming from improper accounting of sales of its loans. "PanAmericano was the wake-up call," says Denise Debiasi, the São Paulo -based managing director for Latin America at FTI Consulting (FCN), a Baltimore firm that advises on compliance, risk, and finance. "There's risks people may be overlooking—like credit quality—as the market booms." PanAmericano won't comment on the ongoing investigations, according to a spokesman at the bank's public relations firm.
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To head off a subprime-style crisis, Brazilian authorities in December upped reserve requirements on time deposits held by banks to 20 percent from 15 percent. Banks must put aside more capital to back consumer loans whose terms exceed 24 months.

The government is also looking to regulate Brazil's credit-card industry. There are now 153.4 million credit cards in circulation in the country, triple the number from 2003. The average debt load of Brazilian consumers amounts to 18 percent of total disposable income, compared with 13 percent in the U.S., says Morgan Stanley (MS). In a Nov. 30 interview, Henrique Meirelles, who at the time was Brazil's central bank chief, indicated that.....Read more

To medicare it seems that fraudsters can not only run but also hide

Source: Bloomberg Business Week
Why Medicare Can't Catch the Fraudsters
One provider's claims were paid despite unusual billing patterns
By Justin Blum
Six days a week, the elderly patients came in vans for mental-health group therapy sessions. They filed into outpatient clinics located mostly along South Florida's busy commercial corridors and in strip malls. The seven offices, operated by American Therapeutic, looked legitimate: Medical symbols adorned the windows and signs pronounced each "A Center of Excellence."

The operation, however, was a scam that bilked Medicare, the federal health program for the elderly and disabled, out of $83 million over eight years, according to a 13-count federal indictment in October of two companies and four individuals. Patients were plied with cigarettes and lunch, and some received $35 to sit in a clinic all day, prosecutors say.

Court papers name as the fraud's masterminds Lawrence S. Duran and Marianella Valera, the owners and managers of Miami-based American Therapeutic and another company, Medlink Professional Management Group, that handled the finances. They used the money to pay for a luxury condo on Biscayne Bay, jewelry, private school tuition, and a Maserati, the court documents say. Duran and Valera pleaded not guilty and their lawyers, Lawrence R. Metsch and Arthur Tifford, declined to comment.

Alleged scams like this are not new to the $500 billion Medicare program. What makes these accusations stand out is that officials at the Centers for Medicare & Medicaid Services (CMS), part of the Health and Human Services Dept., say they knew for years that something was amiss. The eight years it took to stop the alleged ring shows how difficult it will be for President Barack Obama to cut costs by reducing Medicare fraud, one goal of the health-care overhaul he signed in March 2010. "The system is broken," says Malcolm K. Sparrow, a professor at Harvard University's John F. Kennedy School of Government. "It wasn't designed with these types of criminal attacks in mind, and it can't cope with them."

In the three and a half years ending in June, Medicare paid $525 million to South Florida outpatient mental-health providers, almost 800 times the amount for New York and 78 times the amount paid in California. It didn't determine the reason for the imbalance because it was busy pursuing other fraud cases, says spokesman Peter Ashkenaz. Instead, Medicare kept paying the bills.

Outpatient mental-health care was supposed to save money by keeping Medicare patients out of hospitals. But the program is vulnerable to schemes that take advantage of regional claims processors that don't routinely compare notes—and miss upticks in billing. In this case, even after an antifraud contractor, SafeGuard Services, a unit of Hewlett-Packard (HPQ), says it detected anomalies, officials didn't crack down.

A probe might have found what prosecutors later described in court documents: Some American Therapeutic patients being treated for mental health problems were so affected by dementia or Alzheimer's that they didn't know where they were. The company recruited patients by bribing managers at halfway houses and assisted-living facilities, according to court papers. From 2003 until October 2010, the clinics submitted almost $200 million worth of claims, of which about 42 percent were paid, according to the indictment.

There are no reliable figures for how much Medicare loses to fraud annually. Senator Tom Coburn (R-Okla.) estimates the loss from fraud, waste, and abuse at $60 billion, based on various studies. Peter Budetti, the agency's deputy administrator for program integrity, says only that there is "a lot" of Medicare fraud, and the more officials look, the more they find. Other Florida providers for years billed for intravenous drugs to treat HIV and AIDS patients, even though the services were not medically necessary or ever provided, a 2007 report by the HHS inspector general says.


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The Government Accountability Office, the investigative arm of Congress, in 2009 reported that a spike in bills from several states for home health care was due in part to "fraudulent and abusive practices." The problem, says Senator Charles Grassley (R-Iowa), a frequent Medicare critic, is that the agency "is only geared to be a check-writing machine" and not a fraud fighter.

A Medicare strike force launched in 2007 by the Justice Dept. and HHS provides a sense of the scale of the problem: It has obtained indictments of more than 825 people who prosecutors say falsely billed Medicare for about $2 billion. The strike force repeatedly has been able to "detect fraud that Medicare has failed to notice," says Kirk Ogrosky, who until March 2010 was a federal prosecutor coordinating Medicare fraud cases and is now a partner at Arnold & Porter, a Washington law firm. "It is a phenomenon that is rarely seen in law enforcement—that the police call the victim to let them know that a crime occurred."

That's what happened in South Florida with outpatient mental health, say law enforcement officials who faulted Medicare for failing to act sooner. The officials, who requested anonymity because they weren't authorized to speak publicly, say the Justice Dept. requested claims data and saw the suspicious pattern. The investigation began after a whistleblower filed a lawsuit that remains under court seal, the law enforcement officials say. Investigations of clinics beyond American Therapeutic have begun, and more prosecutions may follow, they say.


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Cecilia Franco, head of the Medicare office in Miami, says her agency told Justice about the payment imbalance in South Florida years ago. The law enforcement officials say they aren't aware of any such reports. Laura Sweeney, a Justice Dept. spokeswoman, declined to comment. CMS spokesman Ashkenaz says the agency wants to avoid pointing fingers and would not say who at Justice was told, or when.

Detecting abnormal patterns is hard because Medicare's antifraud contractors serve specific regions and don't keep databases that allow for national comparisons. Medicare until recently lacked the money to create a nationwide database and do real-time analysis, says Kimberly Brandt, an attorney at Washington law firm Alston + Bird who directed a CMS fraud detection and prevention unit until June.

Medicare is now buying software to help it flag suspicious claims before they're paid, says spokesman Ashkenaz. Under the health-reform law, Medicare also has more power to screen providers, and in September proposed subjecting some to site checks and fingerprinting. The law makes it easier for Medicare to withhold payments when fraud is suspected, deputy administrator Budetti says. "While it is an easy thing to say what they should or could have done in the past," says Brandt, "the real key is what they are doing now that they have resources and authority" to address.

Those changes will help, says.....Read more

AIG sells Taiwan unit for $2.16 billion

Source: Market Watch
Jan. 12, 2011, 2:14 a.m. EST
By Chris Oliver and Michael Kitchen, MarketWatch
HONG KONG (MarketWatch) — American International Group Inc. said Wednesday it has signed a deal to sell its Taiwanese unit Nan Shan Life Insurance Co. for $2.16 billion in cash.

AIG /quotes/comstock/13*!aig/quotes/nls/aig (AIG 59.37, +0.33, +0.56%) identified the buyer as Ruen Chen Investment Holding Co., a venture 80% owned by Taiwanese conglomerate Ruentex Group and 20% owned by Taipei-listed footwear maker Pou Chen Corp.

The deal included “protections for employees and agents, including an agreement to maintain the existing compensation and benefits package” and Ruen Chen “has also expressed its intention to retain the current Nan Shan management team,” AIG said.

The announcement followed an effort last year to sell Nan Shan to Primus Financial Holdings Ltd. and China Strategic Holdings Ltd. for about $2.15 billion. That proposed deal was turned down by Taiwanese regulators.

In the statement announcing the new transaction, AIG Chief Executive Officer Robert Benmosche said the new buyers “enjoy an excellent reputation in Taiwan.”
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“Ruen Chen has demonstrated that it is able and willing to invest in Nan Shan’s future, and that it will protect and serve the best interests of Nan Shan’s policyholders, employees and agents,” Benmosche said.

The fact that the buyers aren’t financial firms could cause problems in getting the deal approved, with a Dow Jones Newswires report saying Ruen Chen’s beating out several financial bidder came as a surprise to some market participants.

The report quoted a Taiwan lawmaker as saying Chinatrust Financial Holding Co. and Cathay Financial Holding Co. offered higher bids of $3 billion and $2.7 billion, respectively.

Shares of Pou Chen rose in Wednesday trade in Taipei, adding 3.2%, while....Read more

Anatomy of Verizon's iPhone plan

Source: Wall Street Journal
By SHAYNDI RAICE And YUKARI IWATANI KANE
Verizon Wireless finally told the world Tuesday that it will start selling the iPhone, but the carrier toiled in secret with Apple Inc. for two years to make it happen.
The country's largest wireless carrier said it would have the iPhone in stores on Feb. 10 starting at $199, the same price charged by rival AT&T Inc., which has had the phone to itself since its launch in June 2007.

The move will give Apple an important new source of sales in its biggest market for the iPhone and help it compete with rival Google Inc., which had made inroads for its Android operating system by teaming up with Verizon to develop high-end smartphones.

It also will shake up the U.S. wireless market, ending a deal that has driven much of AT&T's subscriber growth and forcing smaller carriers like Sprint Nextel Corp. and T-Mobile USA to compete against bigger rivals armed with an immensely popular phone.

Verizon executives revealed Tuesday that the iPhone was just over a year old when negotiations with Apple became serious in late 2008. Apple started to work with Verizon because it realized it needed to add another carrier to keep its strong U.S. sales momentum, said one person familiar with the matter. The company decided to design for Verizon's CDMA network after realizing the carrier's faster 4G network wasn't available across its subscriber base and was still being refined to work well with phones, another person said.

AT&T U.S. iPhone sales account for about 30% of iPhone sales, according to Piper Jaffray & Co. Analysts think Verizon could sell 7 million to 13 million this year, owing to pent-up demand among would-be buyers who don't want to use AT&T's network. Apple has sold 75.6 million iPhones so far world-wide on a cumulative basis, according to Kaufman Bros.

"The number one question I get is when will Verizon get the iPhone," said Apple Chief Operating Officer Tim Cook, who showed up for the launch. He said his own mother wanted to know, but he wouldn't tell her.

"My wife and I have both been waiting for the iPhone," said Terence Leung, a San Francisco marketing professional. Mr. Leung said he didn't want to switch to AT&T because of its reputation for dropped calls and bandwidth issues. He has looked at Motorola Mobility Holdings Inc.'s Droid phone, but also didn't buy it because of its relative lack of applications and insufficient battery life. He is currently a BlackBerry user.

Some AT&T customers say they have no plans to switch. Maximilian Sylvia, 16, of Holden, Mass., said he's happy with his service and won't be switching to Verizon. "My iPhone works perfectly," he said.

Apple first started seriously working on the iPhone around 2005. It knew it didn't have the ability to support two different wireless technologies so it chose GSM, which was more globally prevalent and could be sold around the world.

People familiar with the situation said that while Apple met early on with Verizon, the talks were never serious because its network was based on a different technology.

Apple also began serious conversations with Cingular, a predecessor of AT&T's wireless unit. To keep the project secret, it gave codenames, a person familiar with the matter said. The iPhone was P2, Apple was Acme and Cingular was Cypress — named after the hotel down the street from Apple headquarters where they stayed.

Change became possible with the expiration of AT&T's exclusive deal to carry the iPhone, which ended "recently," Mr. Cook said. Verizon Communications President Lowell McAdam traveled to Apple headquarters in the first half of 2010 to seal the deal. Verizon's arrangement isn't exclusive, meaning other U.S. carriers could in theory eventually carry the iPhone as well.
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AT&T has acknowledged it was unprepared for the deluge of data traffic the iPhone brought to its network. The stress led to reports of high numbers of dropped calls and slow service. A Consumer Reports survey last year ranked Verizon first and AT&T last in terms of network quality for major carriers.

Verizon worked closely with Apple to avoid a similar embarrassment in creating a phone for its CDMA network. Verizon more than any other major carrier has built its reputation on network quality.

"If we screw that up, it's a bigger deal for us than for the other guys," said Verizon Wireless Chief Operating Officer John Stratton.

The two companies collaborated closely on design and testing. Verizon installed a number of cell towers on the Apple campus in Cupertino, Calif., so the company could test the phone in their own backyard. The two companies also traded teams of employees more than a year ago.

Verizon has also been shoring up its ability to handle data traffic, particularly in big cities. In the second half of last year, the carrier began lighting up unused 3G spectrum in selected markets and installing the equipment to make it run. Tony Melone, chief technology officer for Verizon, says it will continue to add more capacity in the first half of this year.

"We have built up a very big data cushion," said David Small, chief technology officer of Verizon Wireless.

Some questions about the Verizon iPhone weren't answered Tuesday. Verizon wouldn't discuss service plans, promising more details before taking preorders online on Feb. 3.
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Despite an introduction from Mr. McAdam that included touting the benefits of the carrier's fourth-generation network, the company also didn't have a date for an iPhone that will work on Verizon's new 4G network.

At the end of the press event in New York City, Mr. McAdam walked past a few Verizon salesmen and asked. "You guys gonna sell some phones now?" The salesmen smiled and kept walking.

"I told John Stratton, 'It's all in your hands now'," recalled Mr. McAdam. As executive vice president and chief operating officer of Verizon Wireless, Mr. Stratton is......Read more

The United States vows to match China's export

Source: Wall Street Journal
By SUDEEP REDDY

WASHINGTON—The Export-Import Bank of the U.S. is taking on China's export machine, in a deal designed as a model for developed nations to challenge China in markets around the world.

In a move crafted with White House involvement, the U.S. export-financing agency agreed for the first time to match China's cheaper financing terms to get the Pakistan government to buy 150 General Electric Co. locomotives.

The financing terms for the $477 million deal required the U.S. to work with the Organization for Economic Cooperation and Development, a multilateral organization that monitors export-financing terms by developed countries—but not by China—to attempt to provide a level playing field.

The move is one of several challenges the Obama administration has made to China, the world's largest exporter, as its president, Hu Jintao, prepares to visit Washington next week.

"They're winning deals in part because they're not playing by the rules," Ex-Im Bank Chairman Fred Hochberg said in an interview. "This says: We're not going to sit idly by and let you buy business. We will compete and make sure you stand toe to toe with American companies and American workers."

The Ex-Im Bank deal is one of several steps the Obama administration has taken to pursue its goal of doubling U.S. exports over five years. The U.S. and other governments have been pressing China to let its currency appreciate, which would make Chinese exports more expensive. The administration also has brought complaints against China at the World Trade Organization, most recently challenging Chinese subsidies for production of wind-power equipment.

"Anytime the U.S. wins a trade case…it opens the door for other countries," said Eswar Prasad, a professor of trade policy at Cornell University and former head of the International Monetary Fund's China division. "It opens the floodgates for other countries and it emboldens other countries to act more forcefully against China." But, he added, "how far you can push that strategy remains to be seen."

The Pakistan deal was seen as a key test case by the Ex-Im Bank, which financed $25 billion of exports in the fiscal year that ended in September 2010. China's export-financing arm has ramped up in the past decade to support its exports. U.S. officials estimate that the Chinese agency already finances more than the total export financing of the Group of Seven industrialized nations combined.

The Chinese Embassy in Washington didn't immediately respond to requests to comment.

Pakistan had indicated its interest in buying locomotives made by GE if the U.S. matched China's financing terms, which were sweeter than those allowed by the OECD agreement. The Chinese railcars were 30% to 50% cheaper than the GE products, but U.S. officials said Pakistan wanted the American equipment.
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"The underlying premise has been that we ought to let products compete on their own merits, their own quality, their own value, and not let financing be a distorting factor," Mr. Hochberg said. China, not an OECD member, has long operated outside the group's agreed-upon terms. "Tolerance of that began to wear thin over the last 18 months," Mr. Hochberg said.

Early last year, the Ex-Im board agreed to finance about $437 million of the deal under a 12-year loan. It would carry a lending rate, tied to Treasury bond yields, that is now about 3% and an exposure fee of 8.2%. Ex-Im Bank notified the OECD, and officials said other OECD members encouraged the bank to move forward as a challenge to China's practices. The locomotives, which Pakistan's government plans to buy over two years, will be manufactured in Erie, Pa. The deal, expected to support about 700 U.S. jobs, has been approved by Pakistan pending a review by its Supreme Court.

"We are pleased that Ex-Im Bank offered fair, competitive and transparent financing to Pakistan Railways in support of GE's proposal," GE said in a statement Tuesday. "Ex-Im Bank's financing creates a level playing field for U.S. companies to compete and, ultimately, lays the foundation to sustain existing and to create new U.S. high-tech manufacturing jobs."

Officials at the U.S. Treasury, State Department, Commerce Department and White House were involved in striking the deal with Pakistan, which is important to U.S. strategic interests.

Last month, Chinese Premier Wen Jiabao visited Pakistan and promised billions of dollars in infrastructure spending. The Chinese are building rail and road links from Xinjiang down through Kashmir to the Arabian Sea, and also financed the port of Gwadar on the Arabian Sea coast, through grants and concessional financing. Pakistan imports more than twice as much in goods from China annually as it does from the U.S. The U.S. has reoriented its aid in Pakistan to focus more on infrastructure, in part to challenge China. That has antagonized India, which is especially angered by the Kashmir rail link through disputed territory. The U.S. hopes its new focus will help influence Pakistan to be more pliable in fighting Taliban militants and help boost the U.S.'s image with Pakistanis.
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The Chinese are expected to try to avoid embarrassment in the Hu-Obama meeting next week, and the Obama administration is expected to play on that to press China for changes in trade, foreign exchange and national-security policies. But thus far China's military has rebuffed U.S. calls for regular high-level defense talks.

In the U.S., the administration isn't the only player setting the tone. On Tuesday, the U.S.-China Economic and Security Review Commission, a panel created by Congress that often takes a hard line on China, said growing Chinese strength in telecommunications could pose a danger for the U.S. "This greater potential role for China has generated concerns regarding corresponding potential national security implications of manufacturing and investment by China's telecommunications companies," its report said.

At least one House panel, the Foreign Affairs Committee, is considering holding hearings during Mr. Hu's visit on China's human rights, economic and foreign exchange practices.
—Bob Davis and Tom Wright contributed to this article.

BMO (Bank of Montreal) unveils online personal finance management tool

Source: Financial Post
Jonathan Chevreau January 10, 2011 – 10:32 am
BMO Bank of Montreal today launched MoneyLogic, an online personal finance management tools it says is “the first from a major bank that enables customers to set and track savings goals.”

You can view a 4-minute demo of the product here. In some respects, the tool resembles Mint.com, which was launched in Canada late in 2010. However, as far as I can tell, it’s limited to tracking spending and transactions linked only to BMO bank accounts, lines of credit and BMO Mastercard.

Mint.com is broader in scope since it lets users consolidate information from multiple institutions. A BMO spokesperson said initially MoneyLogic is limited to BMO accounts but that its capability may be expanded later this year.

Even so, the launch is timely, given a flurry of warnings that Canadian families’ debt levels are rising and savings lagging. Canadians are saving 3.3% of their disposable income, down a percentage point from a year ago, according to Frank Techar, president of BMO Canadian personal and commercial banking.

Focus is Saving & Budgeting

The focus of MoneyLogic is saving and budgeting. BMO customer can specify their savings goals — such as putting money away for a new computer or auto — then track their progress as they accumulate funds for that goal. Specific goals can be linked to multiple BMO savings accounts.
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Similarly, you can set budget limits and receive notifications when limits have been reached. So if you’re limited yourself to, for example, $500/month on eating out, MoneyLogic will tell you when you’ve hit the wall.

All this budgeting and saving activity can be collected and presented in graphs and charts (see below).

According to Leger Marketing, 40% of Canadians say they could benefit from a tool that tracks their finances on a day to day basis. BMO senior vice president Lynne Kilpatrick says almost half the bank’s personal banking customers do their daily banking online and can benefit from a tool like this.

While BMO claims.....Read more